The 10th Amendment, anti-commandeering and sports betting: In Plain English

Posted Mon, August 14th, 2017 12:19 pm by Amy Howe

Most Americans are familiar with some parts of the Bill of Rights, such as the First Amendment’s guarantee of free speech and the Second Amendment’s protection of the right to bear arms. Other provisions, however, are less well known – for example, the 10th Amendment, which provides that the “powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” But the 10th Amendment is at the heart of an important Supreme Court case this fall, in which New Jersey and a group of horse-owners will argue that a federal law that bars virtually all states from legalizing sports betting violates the Constitution.

The federal law is the Professional and Amateur Sports Protection Act (known as PASPA), which Congress passed in 1992. PASPA makes it illegal for states to “authorize” “a lottery, sweepstakes, or other betting, gambling, or wagering scheme based” “on one or more competitive games in which amateur or professional athletes participate.” PASPA grandfathered in four states – Delaware, Montana, Nevada and Oregon – that already had sports gambling, and it also carved out an exception for New Jersey that would have allowed sports betting at the state’s casinos, as long as the state set up the scheme within one year after PASPA went into effect.

New Jersey didn’t take advantage of that exception at the time, but nearly two decades later the state appeared to have second thoughts. In 2010, the New Jersey legislature held hearings to consider the possibility of sports betting, which would benefit the state’s struggling racetracks and casinos. In 2011, New Jersey residents overwhelmingly voted to amend the state’s constitution to give the legislature the power to legalize sports betting, which the legislature did in 2012. The National Collegiate Athletic Association and the four major professional sports leagues – the National Basketball Association, the National Football League, the National Hockey League and Major League Baseball – quickly went to federal court to challenge the 2012 law, arguing that it violated PASPA.

The state did not dispute that the 2012 law conflicted with PASPA. Instead, it countered that PASPA violates the 10th Amendment, which the Supreme Court has interpreted to prohibit the federal government from “commandeering” the states to enforce federal law. But the lower courts rejected that argument, with the U.S. Court of Appeals for the 3rd Circuit ruling that the “anti-commandeering doctrine” did not apply because PASPA does not require the states to do anything; it simply bars them from allowing sports betting. The Supreme Court denied review of that decision.

In 2014, the New Jersey legislature returned to the drawing board. It passed a new law that did not affirmatively legalize sports betting, but instead repealed existing prohibitions on sports betting, at least as they applied to New Jersey casinos and racetracks. The NCAA and professional sports leagues again went to federal court, where the lower courts once again ruled for the leagues. This time, the full 3rd Circuit ruled that, even though New Jersey had “artfully couched” the 2014 law as simply a “repealer,” the statute nonetheless authorized sports betting at casinos and racetracks in the state. This time the Supreme Court agreed to weigh in, granting two petitions for review by New Jersey Governor Chris Christie and the New Jersey Thoroughbred Horsemen’s Association, a group of horse-owners and trainers that also owns a racetrack in New Jersey, which the group believes can only be saved from financial ruin by money from sports betting.

In the Supreme Court, Christie and the NJTHA portray PASPA as an attempt to to take over the legislature’s job that is “dramatic, unprecedented, and in direct conflict with this Court’s Tenth Amendment jurisprudence barring Congress from controlling how the States regulate private parties.” Unlike the 2012 law, they emphasize, the 2014 law does not affirmatively authorize sports betting, but instead just repeals the existing bars on sports betting at casinos and racetracks, without giving the state any role to play in the sports betting that will follow. Indeed, they point out, during the litigation challenging the 2012 law, the federal government itself told the 3rd Circuit that New Jersey was “free to repeal those prohibitions in whole or in part.” And if the 10th Amendment bars the federal government from requiring states to regulate, they contend, it must also be true that the federal government cannot require states to keep on their books laws that they have opted to repeal – which amounts to essentially the same thing as mandatory regulation.

Christie and the NJTHA also warn the justices of dire consequences if the leagues prevail. Looking beyond sports betting, they caution that if the 3rd Circuit’s interpretation of “authorization by law” as also barring repeals is allowed to stand, “it is not difficult to imagine other examples in which Congress could dictate policy outcomes in States without ever having to legislate directly. Rather than enact gun control measures of its own, for example, Congress could prohibit States from relaxing existing restrictions on the purchase of firearms by particular persons.”

The NCAA and the leagues push back, praising the 3rd Circuit’s ruling as a “commonsense conclusion.” The Supreme Court’s cases, they stress, make clear that the anti-commandeering doctrine only comes into play when Congress expressly creates obligations that “force states to do Congress’ bidding.” But PASPA, they suggest, does nothing of the sort: “It does not compel states (or state officials) to do anything,” but instead simply bars the states from authorizing sports betting. In that sense, they argue, PASPA isn’t any different from “scores” of other federal laws that regulate the states by specifically barring them from passing laws that “conflict with federal policy.” And in this particular case, the leagues observe, there is direct evidence that Congress would have viewed the state’s current efforts to allow sports betting at casinos as a PASPA violation: PASPA specifically gave the state “an exemption for a one-year window, and only a one-year window, to adopt such a law.”

The leagues also reject New Jersey’s argument that the 2014 law only repeals some prohibitions on sports betting, rather than authorizing it, as “mere semantics.” Even if New Jersey calls the 2014 law a “partial repeal,” the leagues say, it is still an authorization. To be sure, the leagues concede, PASPA does not necessarily prohibit “any and all state efforts to repeal or alter existing sports gambling prohibitions.” But it does require courts to look at “the substance of state laws, not just at labels.” And here, the leagues conclude, the 3rd Circuit was correct that, “whatever else PASPA may prohibit or permit, it does not allow a state to use wordplay to channel sports gambling to its favored venues for state-authorized gambling while prohibiting it everywhere else.”

The justices often grant review to resolve differences in opinion among the federal courts of appeals. However (as the leagues emphasized in urging the court to stay out of the dispute), there is no such division in this case, and – when asked by the Supreme Court to weigh in – the federal government (whose opinions the justices take seriously) recommended that review be denied. The fact that the Supreme Court nonetheless agreed to take on the case suggests that at least several justices regard the 10th Amendment issue as an important one; we’ll know more about how they are likely to rule when they hear oral argument this fall.

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On November 13, Justice Sonia Sotomayor, Judge Jennifer Walker Elrod of the U.S. Court of Appeals for the 5th Circuit and Judge Susan Carney of the U.S. Court of Appeals for the 2nd Circuit presided over the final round of the 2018 Ames Moot Court Competition at Harvard Law School.